Chronic liver diseases are the 12th leading cause of mortality and among the most common causes of morbidity in the U.S. with 5.5 million people suffering from the diseases. The liver has an enormous capacity to regenerate itself, but this capacity is greatly reduced in the diseased liver, making liver transplantation the only effective treatment for end-stage chronic liver diseases. The shortage of donor livers however makes this therapy extremely limited, thus necessitating alternative therapies. Augmenting innate liver regeneration can be an alternative therapy because it may mitigate the diseases and improve the quality of life. During innate liver regeneration, regenerated hepatocytes can be derived from preexisting hepatocytes or biliary epithelial cells (BECs). BEC-driven liver regeneration occurs when hepatocyte-driven liver regeneration is compromised, which is the case in patients with chronic liver diseases. It appears that BEC-driven liver regeneration was initiated but failed to b complete in the patients. Understanding of the entire process of BEC-driven liver regeneration should provide significant insights into how to complete this process in liver patients as therapeutics. Thus, we developed an innovative zebrafish liver regeneration model in which regenerated hepatocytes are exclusively derived from BECs. Using this model, we found that pharmacological inhibition of Bmp signaling impaired BEC-driven liver regeneration. Based on our preliminary studies, we hypothesize that Bmp signaling plays multiple roles in BEC-driven liver regeneration. We will test this hypothesis by pursuing the following three specific aims. Aim 1: We will delineate temporal characteristics of BEC-driven liver regeneration in our zebrafish model by testing our working hypothesis: BECs first proliferate, dedifferentiate into hepatoblast-like cells, the equivalent of oval cells in rodent liver injury models, and then redifferentiate ino hepatocytes that actively proliferate to recover liver mass. Aim 2: We will determine the roles of Bmp signaling in BEC-driven liver regeneration, by blocking or enhancing Bmp signaling at distinct time-windows during hepatocyte ablation and liver regeneration and by examining BEC-driven liver regeneration in smad5 mutants. Aim 3: We will determine the role of Id2a, a member of the inhibitor of differentiation family of transcription factors, which is known to be the direc target of Bmp signaling in several tissues, in BEC-driven liver regeneration by testing the working hypothesis that Id2a mediates the effect of Bmp signaling on BEC-driven liver regeneration. The accomplishment of the proposed work will significantly advance the field of liver regeneration by revealing the mechanisms by which Bmp signaling regulates BEC-driven liver regeneration. Furthermore, they will provide novel insights into how to augment and complete BEC-driven liver regeneration in patients with chronic liver diseases as therapeutics.